7 Stocks Soaring on Unusual Volume

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst.

WINDERMERE, Fla. ( Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

This is a biopharmaceutical company engaged in the development and commercialization of therapeutic products for large underserved markets. This stock closed up 8.1% at $14.87 in recent trading.

Today's Volume: 18.52 million

Average Volume: 4.82 million

Volume % Change: 256%

Shares of VVUS are ripping higher today after the company said it shipped 12,978 Qsymia prescriptions in the period ending on Dec. 21, up more than 67% from the previous four-week period.

From a technical perspective, VVUS is gapped up sharply higher today with monster upside volume. This move has pushed shares of VVUS into breakout territory, since the stock has cleared some near-term overhead resistance at $14.01.

Traders should now look for long-biased trades in VVUS as long as it's trending above that key breakout level of $14.01 with strong upside volume flows. I would consider any upside volume day that registers near or above its three-month average action of 4.82 million shares as bullish. If VVUS can maintain that trend, then this stock could hit $18 to $20 in the near future.